Enrolled Bill Summary

Senate Bill 661	Senate Author:  Carona
Effective:  9-1-13	House Sponsor:  Laubenberg

Senate Bill 661 amends the Health and Safety Code to remove obsolete references with respect to the organization of a corporation conducting a business for cemetery purposes either as a nonprofit corporation under the Texas Non-Profit Corporation Act or as a for-profit private corporation and instead require such a corporation to be a filing entity or foreign filing entity as defined by the Business Organizations Code, the formation and governance of which is subject to statutory provisions governing the formation of a nonprofit cemetery corporation by plot owners and the rights of plot owners in a cemetery operated by such a corporation.

 The bill expands the authority of the Finance Commission of Texas and the Texas Funeral Service Commission with respect to the regulation of cemeteries and cemetery operations to include the regulation of mandatory time frames for the start and completion of construction of a lawn crypt section of a cemetery, the refunding of payments made on an undeveloped lawn crypt space on which construction was not begun or completed within the prescribed time frames, and the disclosure requirements applicable to a sales contract for an undeveloped lawn crypt space.

Senate Bill 661 requires a corporation chartered on or after September 1, 1993, and before September 1, 2013, to have a minimum of $75,000 in capital for each certificate of authority to operate a perpetual care cemetery issued to the corporation on or after September 1, 2013, in addition to the required minimum capital of $75,000. The bill requires a corporation whose certificate of formation takes effect on or after September 1, 2013, to have a minimum of $75,000 in capital for each certificate of authority to operate a perpetual care cemetery issued to the corporation. The bill adds a majority ownership of the stock or other corporate ownership or membership interest as a further condition under which a proposed transferee of business ownership of a perpetual care cemetery who is not a certificate holder must file any necessary document with the secretary of state as well as an application for a certificate of authority with the Texas Department of Banking.

Senate Bill 661 makes it a second degree felony offense for an individual, firm, association, corporation, or municipality or an officer, agent, or employee of such an entity to make more than one interment in a plot in a cemetery operated by a cemetery organization or to remove remains from a plot in such a cemetery without the consent of each of the plot's owners, the cemetery organization, and the decedent's surviving relatives, as applicable in each case.

Current law requires a cemetery organization to file an amended map or plat with the county clerk if a change is made in the shape and size of a cemetery property under a provision in a certificate or declaration of dedication of the property.  Senate Bill 661 establishes a filing deadline for an amended map or plat of not later than the last day of the next calendar quarter after the change is made and exempts a cemetery organization that holds a certificate of authority to operate a perpetual care cemetery from the requirement to file an amended map or plat if the change is limited to the placement of a cremains receptacle containing not more than four niches on a plot or the alteration of an existing cremains receptacle on a plot and the organization keeps records, as required under finance commission rules, specifying the receptacle's location.

The bill reduces the time frame allowed for a corporation operating a perpetual care cemetery to correct a violation of law before the attorney general may bring suit or quo warranto proceedings for the forfeiture of the corporation's charter and for the corporation's dissolution and adds a district court in Travis County as an alternate venue for such proceedings.